As we expected the US election is tight and risk markets are starting to look shaky.

The AUD/USD has been wild over the last few hours, swinging up and down as the latest key numbers on the battleground states roll on in.

So far, Biden is ahead, but the numbers are not bad for Trump and he is not without a chance.

Interestingly, risk assets pushed higher yesterday, in a sign that the smart money is still confident of a Trump victory. However, it is still early on and too close to call.

Looking towards the local currency we have also had a busy 24 hours of news flow for the AUD/USD.

Yesterday, of course, the RBA slashed key interest rates to 0.1% taking them to a new record low level. The news was expected and price didn’t fall away that far, but at the same time, it does appear that the US election sentiment has lifted the AUD as well.

This morning key retails sales data was released that came in better than expected at -1.1%, while the private services PMI data was also positive.

Price actually pushed above 0.7200 in a sharp spike, before retracing under 0.7150 to where it currently sits.

At this stage there is no point predicting a result, we need to simply react to what the price action is telling us. Price will move as the results become clear.

A hold above 0.7200, could be a good short trigger, however, a Biden victory might see that 0.7000 level come under real pressure.

Things are setting up for a massive 24 hours.